Vulnerabilities and disruption risks for the supply chains of Critical Materials necessary for the clean energy transition

Faced with the challenge of reducing EU dependence on fossil fuels, especially those imported from Russia, on top of the longstanding climate crisis, the EU has adopted ambitious targets towards accelerating the decarbonisation of its economy and towards net zero emissions by 2050. But, the clean energy transition is a materials transition: Focus is shifting away from the fuels and moving towards the materials which are necessary for manufacturing the clean energy technologies, such as wind turbines, photovoltaic panels, batteries and hydrogen electrolysers. In order to meet the EU’s energy and climate targets, we need to build the right technologies, in the right quantities, at the right speed. A failure to fulfil these conditions could jeopardise the clean energy transition, delay the decarbonisation of our economy and finally derail EU’s efforts to meet its climate targets. However, many of these clean technologies require materials that are imported from just a handful of countries. Most important are the Critical Raw Materials (CRM), which are those materials that have significant economic importance and are exposed to a high supply risk, often because of a high concentration of supply from a few third countries. Demand for these precious resources is expected to increase exponentially in the coming years, as not only the EU but also the rest of the world will increasingly rely on renewable energy sources. This combination of import reliance on a small number of third countries on one hand, and the exponential increase of the materials demand on the other, makes the EU vulnerable to supply disruptions and elevates the resilience of the relevant supply chains to an issue of paramount importance: It is an issue of Open Strategic Autonomy.